Calgary’s housing market showing signs of stability, but the road to a full recovery will take time.
When we talk about recovery, we have to differentiate the marketplace conditions because there are two segments facing different prospects. There’s the detached market that seems to be improving, and then there’s the apartment segment, which continues to struggle.
Sales in the detached sector have improved from low levels over the past two years, but at the same time fewer listings have been coming onto the market reducing inventory and supporting some price stability.
In March 2017, detached resales increased by 17 per cent compared with the same period last year, and inventory declined by 25 per cent. Prices have remained relatively stable as a result.
With apartments, the challenge is increasing supply in the new home sector weighing on the market. There is a large amount of new apartments under construction, and it is difficult for supply to quickly adjust to the current demand environment as builders rarely halt construction midway through a project.
Still, apartment sales increased, as did the attached segment in the first three months of the year compared with the same period in 2016.
Employment growth “is critical” to the real estate market. Jobs increase migration and that helps drive housing growth.
Job growth has gone on a small run of late. And oil prices have stabilized, which is equally important. These are good signs for the resale housing market.
The city may face an entirely new normal of slower growth.